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RSI Stock Trading Classic Bullish Divergence and Stock Trading Classic Bearish Divergence Stock Trading Setups

Stock classic divergence is used as a possible sign for a stock trend reversal. Classic stocks trading divergence setup is used when looking for an area where stocks price could reverse and start going in the opposite direction. For this reason stock classic divergence is used as a low risk entry method and also as an accurate way of exit out of a stock trade.


  • Classic stocks trading divergence is a low risk method to sell near the top or buy near the bottom of a stock market trend, this makes the risk on your stocks trades are very small relative to the potential reward.


  • Classic stocks trading divergence is used to predict the optimum point at which to exit a stock trade


There are two different types of RSI Classic stocks trading divergence trading setups:


  1. Stock Trading Classic Bullish Divergence Setup

  2. Stock Trading Classic Bearish Divergence Setup


Classic Stocks Bullish Divergence

Classic stock trading bullish divergence occurs when stocks price is making lower lows (LL), but the oscillator is making higher lows (HL).

RSI Stock Trading Strategies

Classic Stocks Bullish Divergence - RSI Stock Trading Strategies



Classic bullish stocks trading divergence warns of a possible change in the stocks trading market stock trend from down to up. This is because even though the stocks price went lower the volume of sellers that pushed the stocks price lower was less as illustrated by the RSI stock indicator. This indicates underlying weakness of the downward stocks trend.


Classic Stock bearish divergence

Classic stock trading bearish divergence occurs when stocks price is making a higher high (HH), but the oscillator is lower high (LH).

Stock Trading Classic Bearish Divergence Stock Trading with RSI Indicator Stock Trading Strategies

Stock Trading Classic Bearish Divergence Stock Trading with RSI Indicator Stock Trading Strategies



Classic stock trading bearish divergence warns of a possible change in the stock trend from up to down. This is because even though the stocks price went higher the volume of buyers that pushed the stocks price higher was less as illustrated by the RSI stock indicator. This indicates underlying weakness of the upward stocks trend.

 

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